Down Payment

What is a Down Payment?

The down payment is the amount of your own money that you are “chipping in” when getting a mortgage to buy a home.
In the past, the banks were able and willing to finance 100% of the cost of your purchase. Unfortunately, those days are gone.

How much down payment do I need?

Today the minimum down payment required is as follows:

5% of the purchase price

If you or a family member intends to live in the property. If you choose to put down less than 20%, you will have to pay CMHC fees

20% of the purchase price

If the home will be a rental property.
No CMHC fees.

Purchase price of your home
Minimum amount of your down payment
Less than $500,000
5% of the purchase price
$500,000 to $999,999
5% of the first $500,000 of the purchase price
10% for the portion of the purchase price above $500,000
$1 million or more
20% of the purchase price

To calculate the percentage of down payment, divide the purchase price by the amount of down payment.


If you don’t have enough down payment, you might want to consider buying by way of RENT TO OWN. There is a very reputable company that does Rent to Own in Alberta.

Real Suite Assets

In order to get a mortgage with the minimum down payment, the lender will want to see that you have a good credit score with a clean report showing little to no missed payments etc and no recent bankruptcies.The source of the down payment must be tracked by your lender as well. The down payment can come from any of the following sources:

The bank will require 3 months of bank statements showing that you’ve had this money for at least 90 days in an account or investment with your name on it.

With home prices on the rise, more people are having to get help from family members in order to purchase a home. When being gifted down payment funds, most lenders will ask for a signed gift letter from the source of the gift, as well as bank statements showing the money was received into a bank account with your name on it.

First time home buyers can borrow up to $35,000 from their RRSP without penalty to use towards the down payment. You then have 15 years to repay the funds back to your RRSP.

If you’re selling a home at the same time as buying another, you can use the equity that’s paid out to you from the sale of your previous home as a source of down payment for buying a home.

If you have a HELOC or a line of credit that is secured against another home or property, you can use those available funds as a source of down payment for buying a home.

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